Valley Localities Leading State Job Recovery
In June, Harrisonburg and Rockingham County reached a milestone of recovering over two-thirds of the jobs lost in March and April 2020, according to Joe Mengedoth, a Richmond Federal Reserve Bank economist.
Statewide, 60% of jobs have been recovered since the mass job loss during the first two months of the pandemic, he said.
Shenandoah Valley localities have led the way in the state for local job recovery, Mengedoth said.
The Winchester metro area recovered 101% of the jobs lost in March and April 2020 by June, while Staunton recovered 84% by June, according to Mengedoth, citing the most recent data available.
Harrisonburg and Rockingham County clawed back 70% of the jobs lost in the first two months of the pandemic by June.
Other parts of the state have not had such a bounce back.
Charlottesville and Lynchburg have each only built back less than 40% of the jobs lost during March and April 2020, while Richmond has recovered 45% of jobs lost during the same period, according to Mengedoth.
“The job recovery really depends on where you are and in the industry and where you are geographically,” he said.
Mengedoth said the Valley’s leading job recovery can be traced to gains in manufacturing and associated labor, such as warehousing and transportation, making up for the losses in food service and hospitality work, which has been most impacted by the pandemic.
“I think we’ve seen some incredible demand for manufactured products, especially food and groceries and then furniture,” he said.
Statewide, the economic recovery continues its uneven comeback as 3,200 new jobs were created in June and the unemployment rate dropped slightly to 4.3%, Mengedoth said.
Last month, the biggest job gains were 5,900 new government jobs, 2,800 new food service and accommodation jobs, and 1,400 new construction jobs. However, there were large job losses, too, such as 6,800 in the arts and entertainment industry, 1,300 in professional business services and 900 in financial service.
“Weekly unemployment claims data show initial and continued claims have continued to decline over the last several weeks and are at their lowest level since the pandemic began,” Mengedoth said.
Wage increases are near the point they were before the pandemic during a period of historically low unemployment, according to Mengedoth.
Experts have said that the inability for employers to find workers results in increased wages and benefits for employees, but the labor shortage also presents difficulties to a business’ ability to grow and operate due to increased costs.
Mengedoth said year-over-year earnings increases were at 4.5% before the pandemic and year-over-year earnings increases are at 4.25%. And he said workers are not only seeing higher pay as employers compete, but many workers are also being offered benefits they were not offered before.
“Definitely, I would say anecdotally we’re certainly hearing about wage increases and not just for advertising to get those workers but also how that’s spilling over and raising wages [or benefits] of existing staff because they know the higher wage rates are being offered [by other companies] or for retention,” Mengedoth said.